The Angel of Financial Death
Part One of Five

International Medical Veritas Association

The precipice America stands on is narrowing
dramatically and our government and The Fed
are chipping away at the rock with jackhammers.

Karl Denninger

We are no longer on the edge. We as a race of beings are falling into an abyss and it is more than doubtful if all the kings’ men can put humpty dumpy back on the wall again. In fact we are sure of it so listen to the alarm bells and abandon ship. Unfortunately it is more than difficult to go anywhere and it costs a lot of money to do so. The vast majority of us are going to have to defend our lives from the point we are now at so look around you, is this where you want to make your last financial stand? Yes there are many of us lucky ones who will escape the worst of it but that is not very comforting as the lights go out for many millions of people.

The worst is yet to come. This is only the beginning.

Olivier Blanchard

International Monetary Fund's top economist

There are many out there trying to do the right thing, waiting for things to get better. What you are about to read indicates that this is not correct - what we should be doing is waiting for things to get worse, much worse. The right thing at this exact point in time is to put our consciousness on worst case scenarios and plan accordingly, even if that is only possible on a spiritual level of heart and being. It is spiritually wise to accept fully what is happening and about to happen. When we face the worst case scenario one accumulates a strength that is going to be useful as everything shifts around us. Listen to Governor Schwarzenegger: Things will get worse talk about facing these scenarios.

Consider how much darker the economic picture has grown since
the failure of Lehman Brothers, which took place just over two
months ago. And the pace of deterioration seems to be accelerating.
The next two months will inflict serious pain on hundreds of
thousands of Americans, who will lose their jobs, their homes, or both.
Paul Krugman
NY Times

Life is structured for most of us in modern civilization to minimize our freedom of movement and choice in the current circumstances. Change comes with difficulty for all of us for more reasons than can be written in a book. My writings on this subject are dedicated to those who believe that information and intelligence are necessary in crisis. We have never had such a need to be on alert in our lives as The Angel of Financial Death reaches his deadly breath to more and more people around the globe.

It is amazing how rapidly conditions have deteriorated.

Dan Meckstroth

Chief economist - Manufacturers Alliance

"If you are not fearful, you're crazy," said Jamie Dimon, JPMorgan's chief executive, in his last conference call with analysts. Martin Weiss writes: “Fear of depression is sweeping the nation. Millions of Americans are consumed with anxiety, abandoning their old shop-till-they-drop habits, slashing their spending, trying desperately to pinch pennies for the coming hard times.” Thousands of bankers are snapping shut their coffers, tightening their lending standards, hunkering down in anticipation of a massive economic downturn. Retail Sales are in a head long nose dive - the worst decline in years, car sales have collapsed, consumer confidence is plumbing the depths of 50 year lows, unemployment is skyrocketing, the banks are loaded with bad debt, central bank liquidity has exploded.

We are just beginning to understand that the solutions are not solving anything. No matter how much money the central banks of the world are throwing at the problem we are sinking. The pumps are not keeping up against the endless hole of debt collapse. All the money printing and central bank lending at whatever interest rate is simply disappearing into the ‘black hole’ of a bottomless debt trap. The majority of Americans, many in positions of power, have never lived through an economic calamity like the Great Depression. They have no idea what is going on, not really so they are running around clueless about what to really do. Or in contrast, top leaders really know what is going on and are staging a huge theater to keep the masses from panic until that is impossible to do anymore.

Martin D. Weiss, Ph.D. writes, “It is preposterous to assume that any government, no matter how powerful it may seem, can save the entire world. It is naive to believe that a few government bureaucrats, with a grab-bag of gimmicks and tricks, are a match for billions of consumers in revolt, millions of investors desperate to sell, and thousands of banks pulling in their horns. The government cannot repeal the law of gravity and stop markets from falling. Nor can it turn back the clock to reverse our financial blunders.”

Taken in total the debt that must be defaulted in order
to restore balance is likely in the $8-10 trillion range in the
United States. Some put the figure as high as 30 trillion.[i]

There are still many Americans and other affluent people around the world who continue to live their lives in denial of the cruel catastrophes soon to befall them and their children. But the mainstream media is starting to openly ponder and publish questions about the coming depression though officially we are “just beginning” to enter a recession. “It has truly felt like ‘the sky is falling’ and that the soup lines of the Great Depression are dead ahead. Perhaps this will be so, and perhaps Deflation will carry the day leading the global economy into a self-reinforcing downward spiral of ‘beggar thy neighbor’ currency devaluations, rising protectionism and contracting global trade. Perhaps, everything will be undone,” writes Frank Barbera.[ii]

The economy is going over the cliff yet officially we can be comforted by the R word that only a year ago only brought terror. Yet the news is very sloppy about what is going on and we hear reports like, “concerned that the economy's downturn might last several quarters” is a cruel joke downplaying totally the severity of the situation. Now of course it’s a week later and perhaps we will pull out of this by 2010. Yesterday the associated press admitted, “With the economy in free fall, President-elect Barack Obama is……” The chances are that the economy will be in pieces by the day he takes office and for that reason Sunday morning popular columnist Jeffrey Friedman wrote, “I would convene a special session of Congress, amend the Constitution and move up the inauguration from Jan. 20 to Thanksgiving Day.”

The English have taken on£800m in new
debt over the past three months to pay bills.

This is not the time to be getting deeper in the hole but for many today it’s their only way of survival. Imagine having to survive on debt and you are seeing what we have not wanted to see these past years. When they finally put up the headline Great Depression Arrives in 2009 they still will not be talking about the children that starved in the last one.

It’s scary to think how much more can
go wrong before Inauguration Day.
Paul Krugman

Between now and June of 2009 we will be on a straight elevator ride down and at the end of this period we will see a sizable percentage of the world economy wiped out. Though governments are already spending and printing and central banks are injecting liquidity into the system we are in free fall and the chances are that during the next eight months a third of the world economy will be contracted, defaulted and bankrupted out of existence. Even with massive government spending the contraction is picking up speed and will reach horrifying negative velocity in the coming few months. The Baltic dry index, a good indicator of global shipping activity, is already down 90%. [iii]

Calin Popescu Tariceanu, Prime Minister of Italy, may
have inadvertently fuelled fears when he told local
TV that the global economy was sinking like the Titanic.

The global economy is entering a slowdown of epic proportions, comparable to the Great Depression, John Thain, chairman and chief executive of Merrill Lynch, warned last Tuesday. "Right now, the US economy is contracting very rapidly.” Bush told world leaders that he had agreed to a $700 billion rescue plan for financial institutions only after he'd learned the U.S. was at risk of sinking into a "depression greater than the Great Depression."[iv] In Eastern Europe, access to foreign currencies is firmly restricted, raising people’s debts through their tattered roofs. Bank runs throughout the Arab world are a nasty sign of things to come. Wait till the effects of the latest oil price plunges starts to really seep through.

Government efforts around the world to secure
the financial system have thus far proven
futile. And it's scaring the hell out of people.

Jack Crooks

Physicists who understand the principles and dynamics of black holes will be out in front of most of the rest of us in completely understanding what is happening. The main idea about black holes is that gravity feeds on itself getting ever stronger as mass builds to a point where nothing gets out, not even light. Our tightly coupled global and financial networks are compounding and amplifying the gravity of the situation because everywhere everyone at once is reacting, which means when things fall they fall spectacularly fast. Information about problems/fears travels so quickly, that everyone ends up cutting back/hoarding faster than responses can be formulated.

Washington is not God. It cannot save the
world. It cannot prevent the next depression.[v]
Martin D. Weiss

This previewed collapse or trip to financial hell will happen because at the very heart of the problem is a cancer that has to be wiped out. Debt, debt creation, central banks, fractional reserve banking, leveraging, compound interest and Usury are common denominators that line the walls of our present system. Those who are resisting events with all their power are the very ones who do not want us to know that there is a better way then the insanity that money is debt and interest should be charged on all of it. This is the clear lesson we are being given today. Debt it turns out is not money it’s a weight that can break even the strongest corporation or governments back. It could even break the back of the world. It certainly is already breaking the backs of millions of Americans whose total aggregate consumer debt is around 14 trillion. Imagine the impossibility of trying to pay that back during a great depression.

How Does $14 Trillion In Consumer Debt Get Paid
Back? It Doesn't. Where will all the money come
from to cover these losses? The answer is "no where."

Douglas A. McIntyre.

The contraction is reaching a critical stage and in only a month or two we will see the wreckage and ruin with much starker eyes. “We are now flirting with a bond market dislocation and potential exposure of The Fed's machinations, which will bring the curtain down on all the games at once. In my opinion the evidence is incontrovertible that we are literally teetering on the precipice. I put the odds of the plates falling within the next two months - and possibly within the next couple of weeks - at one chance in three,” writes Karl Denninger.[vi]

During the great depression the US dollar was a hard
currency backed by a mountain of gold. Today, the US dollar
is a fiat (paper) currency backed by a mountain of debt.

Almost everyone at once is seeing the danger of debt and the crushing blow of having to service it which only gets worse in deflationary spirals. There is something pernicious about inflation falling too far, too fast, which is what is happening right now with the commodities melt down, markets nose-diving, and housing prices still in free fall. Falling prices make debt more expensive, indebted households become even more anxious to pay off loans, and this only feeds deflation as money (which is debt) contracts even further. No matter how much money is being created into existence in thin air (by the Fed) inflationary fires are being put out as the contraction proceeds forward at ever increasing pace.

The Labor Department reported Tuesday that wholesale
prices dropped by 2.8 percent in October, the biggest
one-month decline on records that go back more than 60 years.

“Farmers are getting an early taste of a deflationary world. They have finished planting next year’s winter wheat, turning the fields a brilliant emerald green. But it cost about $6 a bushel in fuel, seed and fertilizer to put the crop in. That is $1 more than they could sell it for today,” reports the NY Times. We were in an inflationary spiral just a few months ago but look what has happened in the shortest time anyone can imagine. It’s been like a rocket hitting the top of its flight path and now we are falling back to earth and the trip down is more than scary.

The U.S. of A. has all the characteristics set in place that have
led to the collapse of every other fiat currency money in history.

Most of us do not really understand how deep the rabbit hole goes meaning most of us cannot begin to grasp how deep the lies, deceit and outright theft has led us to the place we now find ourselves in. Most people live their lives never believing anything other than the lies told to them by those they believed in. It seems like we really do not care or are just not capable of caring as long as bad things don’t happen to us. The truth is that we and our economy and financial system is a house of cards built on greed, power, control and outright manipulation of the herd.

I truly hope that my words and this four or five part series will slap at least some people into action yet I say that knowing how difficult any kind of action is today. I truly believe at this point we have to fortify ourselves spiritually preparing ourselves for a world that is turning much more difficult. Gathering together with our loved ones and making plans is in order. It is not everyday that the Angel of Death, in this case financial death comes knocking on our and our neighbors door.

Mark Sircus Ac., OMD
Director International Medical Veritas Association